News

Changes in tax paying from 1 November 2009

A change in tax paying will come into force on 1 November 2009, from which time the date of payment will be the day the money from a Czech crown account is credited to the tax administration’s account. This means that a payment will have to be calculated and sent two days before the due date.

From 1 November 2009 onwards, tax will be considered to have been paid upon showing on the tax office’s account

In connection with the proposed act on the payment system, changes have been proposed to the tax payment system and health insurance and social security contributions (Parliamentary Document No. 861). The act has been signed by the president, and has yet to be published in the Collection of Laws.

The major change concerns the date of payment; currently the day the money is debited from a Czech crown account. Only if debited from a foreign or foreign currency account is the payment date the day the money is credited to the tax administration’s account.

This difference has been abolished in the amendment. The date of payment – made from any type of account – will from now on be the day the remittee’s account is credited. The new system of payment will be effective from:

• 1 November 2009 for taxes (including advances, duties and other charges).
• 1 January 2010 for health insurance and social security.

A payment will now have to be calculated and sent about two days before the due date. For example, calculated VAT for October 2009 will have to be sent by 23 November so that the payment is credited to the tax authority's account on 25 November 2009 at the latest.

VAT – two amendments submitted to the Chamber of Deputies

A government bill amending the VAT Act which, following the EU finance ministers agreement, reclassifies restaurant services (except alcohol and tobacco products), hairdressing and other selected services to the reduced 9% tax rate (Parliamentary Document No. 801), has passed its first reading. It is proposed to become effective on the date of publication.

Another amendment recently submitted to the Chamber of Deputies for first reading is an extensive amendment to the VAT Act; the so-called VAT package implementing EU 2008 Directives (Parliamentary Document No. 887). It regulates the place of supply of services, VAT refunds to persons from other Member States, and recapitulative statements which should change from 1 January 2010. It also introduces provisions on fair market price for VAT-based assessments that will apply in specific cases.

We will publish more detailed information in this matter following September’s session of the Chamber of Deputies.

Delivering tax documents after 1 July 2009

Some minor changes in the delivering of tax documents have been introduced by the amendment to the Administration of Taxes Act. The most important of these is that, once the 15-day deposit period (during which they can be collected from the post office) has expired, the documents will be put into the addressee’s mailbox. However, this depositing of the document in the addressee’s mailbox can be excluded by tax administration. In such cases, or if the addressee does not have a mailbox, the document will be returned to tax administration, where the fact is posted on the official notice board.

The date of delivery remains unaffected. Documents that are not collected from the post office within 15 days will be considered delivered on the last day of the period, and the depositing of the document in the mailbox, or posting of a notice on the official board, will have no bearing on the ‘fiction of service’.

Coordination committee – technical improvement of own assets

Under the VAT Act as amended and effective until 31 December 2008 technical improvement of one’s own assets was not subject to settlement and adjustment of VAT deduction, whilst the amendment to the Act (effective from 1 January 2009) stipulates that settlement and adjustment of VAT deduction have to be applied.

In line with the opinion of the Ministry of Finance, the new rules should also apply retroactively to technical improvement made by the owner prior to the end of 2008 (report of the Chamber of Tax Advisers of the Czech Republic no. 274). As technical improvement often involves spending large amounts, this interpretation could have a considerable impact on VAT payers who are entitled to lower deductions or are not entitled to deductions at all.


Jaromír Zbroj, Senior Manager, TACOMA Tax
Tel: +420 731 411 268
E-mail: jaromir.zbroj@tacoma.eu  

Rostislav Frelich, Senior Asistant, TACOMA Tax
Tel: +420 226 219 000
E-mail: rostilav.frelich@tacoma.eu  
www.tacoma.eu